US Economy and Credit Markets Ended Sept. 4, 2020

Bob Carey
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US Economy and Credit Markets Ended Sept. 4, 2020

Posted Under: Weekly Market Commentary

Last week, U.S Treasury bond yields rose on the short-end of the yield curve as U.S. Treasury bond yields on the long-end pulled back. A couple of catalysts led to long-term Treasury bond yields falling throughout the week. Early in the week, investors sought out bonds on the cheap following the selloff in long-term Treasury bonds. The month of August saw 10-year Treasury yields rise over 17 basis points and 30-year Treasury yields increase about 28 basis points. Bond yields and prices are inversely related. Later in the week, investors continued to flock to Treasurys as a perceived safe haven from retreating equities. The week ended with Treasury yields pushing higher across the yield curve on Friday, leaving only longer-dated Treasury yields in the red for the week. The selloff in Treasurys on Friday was due to a stronger-than-expected jobs report spurring positive sentiment as the jobs market continues to rapidly recover. Nonfarm payrolls beat the consensus expectation and the unemployment rate dropped to 8.4%, well below the peak of 14.7% in April. Major economic reports (related consensus forecasts, prior data) for the upcoming week include Tuesday: August NFIB Small Business Optimism (99.0, 98.8); Wednesday: September 4 MBA Mortgage Applications (n/a, -2.0%); Thursday: August PPI Final Demand MoM (0.2%, 0.6%), August PPI Final Demand YoY (-0.3%, -0.4%), September 5 Initial Jobless Claims (830k, 881k), August 29 Continuing Claims (n/a, 13254k), July Final Wholesale Inventories MoM (-0.1%, -0.1%); Friday: August CPI MoM (0.3%, 0.6%), August CPI Ex Food and Energy MoM (0.2%, 0.6%), August CPI YoY (1.2%, 1.0%), August Monthly Budget Statement (-$242.7b, -$63.0b).

Posted on Tuesday, September 8, 2020 @ 8:27 AM • Post Link	Share:
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These posts were prepared by First Trust Advisors L.P., and reflect the current opinion of the authors. They are based upon sources and data believed to be accurate and reliable. Opinions and forward looking statements expressed are subject to change without notice. This information does not constitute a solicitation or an offer to buy or sell any security.

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